2012 St. George Real Estate Market Forecast

For those of you that have already bought Real Estate here in St. George in the past few years, you'll LOVE to see these below information. And for those of you that are still considering it? Or are still "on the fence", hopefully these recent articles will help you in your decisions.

The number one question I am asked as a Realtor is: "How's the market?"

As we tie up 2011 and look forward to 2012, It's a great time to give you a picture of the current real estate market. Experienced Real Estate Brokers and Industry Veterans all agree the Real Estate trends have begun to shift upward. By no means is the housing crises over; however, several strong indicators confirm this up-shift is indeed happening. One such indicator Real Estate Professionals use to measure the market is called "Absorption Rate." This is the amount of time the current demand would take to sell all the available homes listed on the market. Essentially, we have burned through the glut of homes on the market. More buyers and particularly investors capitalizing on the strong rental market are purchasing homes. This results in a lack of desirable inventory (available homes for sale). Several of my recent buyers have experienced first-hand this change in the market. Desirable properties are being sold quickly and most often will have multiple offers. About 1/2 of the homes on the market are "short-sales" which are under review (waiting for the bank to respond with an "approved price"). The number of short-sales and foreclosure coming on the market are decreasing every month, and new construction is way up from a year ago. Homes are selling. The market is quickly becoming a "sellers" market. The below article will give some additional information about current housing trends in the St. George Real Estate market.

Cedar City • New statewide figures from the Utah Association of Realtors show the St. George real estate market, hardest hit by the housing recession in Utah, may be starting to recover.

The numbers show an uptick in home sales and signed contracts in September, the most recent figures available. Housing inventory in the area also fell, another indication that homes are selling.

And a new report from Fiserv and Moody’s Analytics predicts home prices in the St. George area will rise by 7.9 percent in the second quarter of 2012 over the same period in 2011. According to the same report, St. George will outperform the country: While U.S. prices are forecasted to fall 3.6 percent by next summer, St. George prices are expected to rise nearly 8 percent during the same period.

The report, based in part on data from the Federal Housing Finance Agency, shows home prices in Washington County, which includes St. George, peaked in the fourth quarter of 2006 and then fell about 41 percent through the second quarter of 2011. The current median price of a home in St. George is about $150,000.

Celia Chen, a senior director at Moody’s Analytics, said the agency looks at data from a wide variety of sources, including Fiserv, the National Association of Realtors and RealtyTrac. Fiserv counts deed documents filed with counties when houses are sold.

David Stiff, chief economist for Fiserv, a financial technology and services company that compiles figures for clients on more than 380 housing markets in the country, said St. George was hit hardest in Utah by the housing collapse, with Provo coming in second. St. George was a bubble that grew as investors drove up housing prices in the previous decade. The bubble finally burst in 2008, but prices are expected to stabilize and rise next year.

“There is a large correction going on that will attract investors who want to jump in at lower prices,” Stiff said.

Lori Chapman, who has been selling real estate in St. George for 30 years and is president of the Utah Association of Realtors (UAR), said that between 2003 and 2004, the real estate market was “an insane time” in St. George — borrowing was easy, expectations were high and building outpaced demand.

“I was showing people 10 to 15 houses at a time and then it dropped to one or two,” she said. “It was hard, crazy times ... people were caught in a frenzy and things were not sustainable because [borrowers] were not doing their research.”

But Chapman said 2011 sales through September are up, with 2,744 properties sold compared with 2,465 in 2010.

According to the UAR, the median sales price of a home in Washington County in September was $149,900, down about 3 percent compared with September 2010. The median sales price of a home in neighboring Iron County in September 2011 was $84,900, down about 28 percent from September 2010.

Chapman said this is an ideal time to negotiate a mortgage since interest rates are hovering around 4 percent. “There are many great, great deals out there.”

Cindy Campbell, president of the Washington County Board of Realtors, said St. George remains attractive, especially to retirees and second-home buyers, because of its proximity to national parks, recreation opportunities and mild weather.

“St. George is affordable again,” said Campbell. “Our median-price homes are in line with incomes. In September alone, sales rose and our inventory decreased along with our notices of defaults and foreclosures.”

Neighboring Iron County is also enjoying a rebound. But the numbers should be taken in context. While home sales are up slightly, property values remain depressed. Chris Dahlin, a real estate appraiser and former president of the Iron County Board of Realtors, said more time is needed for financial markets to adjust to supply and demand.

Brian Turmail, a spokesman for the Associated General Contractors of America, said construction in Utah rose 3.9 percent, one of the highest gains in the country. Washington County, which lost 5,200 jobs in the past four years, is included in the upturn.

Below is also a great article from Forbes Magazine which ranks Utah 'the best state for business'. All signs point that the state of Utah are poised for a great recovery over the next few years.

Forbes Magazine ranks Utah 'the best state for business'

Published: Wednesday, Nov. 23, 2011 10:03 a.m. MST

By Joey Ferguson, Deseret News

Utah is the best state for business, Forbes Magazine reported Tuesday, illustrating the positive economic outlook and job growth.

Utah's energy costs, which are 31 percent below the national average, and its 5 percent corporate tax rate helped it top neighboring states, Forbes said. Employment grew 0.6 percent on average over the past five years. Forbes measured states on six categories, including costs, labor supply, regulatory environment, current economic climate, growth prospects and quality of life.

"Being again recognized by Forbes as the country's best state for business and careers is certainly an outstanding honor," Utah Gov. Gary Herbert said in a statement. "But it is no accident; it is the result of deliberate efforts to make Utah the most business-friendly state. While accolades are gratifying, the ultimate fruits of our labors are accelerated economic growth for our state and more jobs for Utah's citizens."

The climate has attracted major business including Procter & Gamble, Home Depot and Boeing, all of which announced Utah expansions this year.

Utah has a five-year annual job growth of 2.4 percent and an unemployment rate of 7.0 percent. Utah's unemployment rate is below the 9.1 percent national average, according to the Bureau of Labor Statistics.

Another Forbes list ranked Salt Lake as the fifth best city to find technology jobs. Salt Lake saw a 5.2 percent job growth in the past two years. Utah was also voted the sixth best state for finding jobs in general.

"No state can match the consistent performance of Utah," said Kurt Badenhausen, Forbes staff writer, in the article. "It is the only state that ranks among the top 15 states in each of the six main categories we rate the states on."

EA Games, a video game company based in Redwood City, Calif., has an office with more than 150 employees in Salt Lake and is hiring.

Brandon Welch, recruitment manager for EA Games, said he works to hire people for projects like "The Sims," a life-simulation computer game. Since he arrived more than a year ago, the company has brought on around 60 employees, including developers, artists and managers.

"Our average is about 75 percent local talent, and the rest we pull out of state," said Welch, who works with programs at local universities to help their curriculum and graduates. "We've done pretty good with just that local pool. We're really trying to push new grad hires with EA."

Local executives credit the entrepreneurial spirit of Utah as the driving force of its business success.

David Bradford, chief executive officer of HireVue, a company that makes Internet software platforms, said that makes Utah unlike most other places for business.

"I've traveled the globe in my career and I have rarely seen a place that has the love and passion of entrepreneurism that the state of Utah has," Bradford said in a telephone interview. "We love to build, create and attempt to sustain great technology companies. People are driven to succeed in this state."